- Contents Protocol, a South Korean cryptocurrency-based content sharing startup, was forced to shut down its business due to negative market pressure.
- Contents Protocol is a subsidiary of Korean streaming service provider WATCHA Play.
- Contents Protocol would then share this data back to the content creators, thus allowing for a better ecosystem for content creation.
Contents Protocol, a South Korean cryptocurrency-based content sharing startup, was forced to shut down its business due to negative market pressure.
The company claims to have made numerous attempts to recover from a weakening customer base, but it eventually succumbed on Wednesday when the company announced that it was shutting down.
This comes as a surprise since the company raised about $7.5 million in Ether in their initial coin offering (ICO) which would have normally meant a strong potential for success in the company’s venture, but as they are closing down, the investments will be refunded back to the investors.
In an official post on its website, the company has stated “regulatory uncertainties in cryptocurrencies and lack of business prospect” as the reasons for their shutting down.
The company will undergo liquidation and all their platform tokens CPT (Contents Protocol Token) that is currently in their possession, and that will be attained during liquidation will be burned.
Contents Protocol is a subsidiary of Korean streaming service provider WATCHA Play. The initial goal of the project was to incentivize users of services like WATCHA Play with their platform token CPT for their reviews and ratings on the content that was being shared on these platforms.
Contents Protocol would then share this data back to the content creators, thus allowing for a better ecosystem for content creation. This concept of data collection and sharing in order to build a better content production structure was the aim of the company.
Their ambitious plans for a better content consumption platform was laid to waste when their userbase began declining due to falling trust in cryptocurrencies, negative market perception, and price volatility.
This overall bad user experience is what led to the eventual demise of Contents Protocol. The strong hits that lawmakers are taking against cryptocurrency regulation also played a huge role in why the South Korean company failed to amass the kind of customer base they expected.
Without a strong community backing the company, it gradually became harder for the company to get content sharing clients that allowed for the integration of their service.
The company raised $8.1 million (29,333 ETH) in its public and private ICOs that was held in December 2018. All these assets have been converted back into Ether worth $7.5 million and will be redistributed back to its investors who have made refund requests.
The rest $1.45 million was used by the company to fund their business during their lifetime as per the asset records published. Those in possession of CPT will also be able to trade the currency for Ether at a rate of $0.0002 worth of Ether for every CPT token.